Boeing announced Monday, Dec. 23 that CEO Dennis Muilenburg is out, in an effort to restore public confidence in the company.
The company — and the Renton-built 737 Max jet — have had a tough year after two crashes, killing all on board, led to a worldwide grounding of the model. The company then recently announced the Renton factory will be shutting down in the start of 2020, until the Federal Aviation Administration (FAA) approves the updated safety changes made to the Max. Renton employees are avoiding layoffs through transferring to other Washington plants.
On Monday, the Boeing Board of Directors in Chicago named chairman David Calhoun as the new CEO and President, effective Jan. 13. Muilenburg has resigned, effective immediately. During the transition, Boeing Chief Financial Officer Greg Smith will serve as interim CEO.
A Boeing press release states the board decided this was necessary to help the company repair relationships with regulators and customers. Earlier in December the Federal Aviation Administration (FAA) chief Stephen Dickson stated to congress that Boeing has been pursuing an unrealistic return-to-service schedule, and directed Muilenburg to stop predicting when the Max would fly again, according to the Seattle Times, and there was a perception the predictions were meant to speed FAA’s approval process.
Muilenburg also took heat from the U.S. House at a hearing in October. U.S. Rep. Debbie Mucarsel-Powell, D-Florida, asked the then-CEO if he intended to resign, to which he said no. She told Muilenburg during the hearing he needed to take full responsibility and step down to help rebuild trust and confidence.
New leadership is going to renew the company’s commitment to transparency and proactive communication for FAA and customers, the Boeing press release states.
The new CEO will start after exiting his non-Boeing commitments, as managing director and head of portfolio operations of a private equity group. Calhoun has been a director on the Boeing board since 2009, and was previously with General Electric (GE) for 26 years, serving as Vice Chairman and CEO of GE Infrastructure.
Board Director Lawrence Kellner will now be chairman as Calhoun steps into the leadership role.
“On behalf of the entire board of directors, I am pleased that Dave has agreed to lead Boeing at this critical juncture,” Kellner stated in the press release. “(Calhoun) has deep industry experience and a proven track record of strong leadership, and he recognizes the challenges we must confront. The board and I look forward to working with him and the rest of the Boeing team to ensure that today marks a new way forward for our company.”
Calhoun also states in the press release that he strongly believes in 737 Max’s future, and that he’s honored to be CEO to the company of 150,000 employees.